Thursday, July 5, 2012
Prepaid card usage outpacing bankcards
During a panel discussion at the Network Branded Prepaid Card Association's First Annual Congress held June 2012 in Washington, D.C., Federal Reserve Senior Economist Geoffrey Gerdes said Americans spent more than $80 billion using general purpose reloadable prepaid debit cards in 2011.
That's just a fraction of the potential market, however. In 2010, payments initiated with all types of debit cards totaled $1.6 trillion, according to Fed data, but that growth in prepaid debit card transactions is outpacing that of all other card categories, Gerdes said. The dollars loaded on prepaid cards are increasing at a rate of 30 percent a year, according to Gerdes.
Additionally, the Fed is slated to begin collecting data this month for its 2012 payments study, which will become available in early 2013. The Fed collects payments data from banks and payment processing networks every two years. The most recent of these surveys, undertaken in 2009, was the first to track growth in prepaid card usage. In 2009 prepaid debit card payments totaled 6 billion, with the total growing at a rate of 21.5 percent since 2007, according to the Fed's 2010 Payments Study.
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